Hundreds of thousands gathered around the country to celebrate Australia's national holiday, a commemoration of the First Fleet's arrival in Australia in 1788.

But for 17,900 Australians the day meant something more than public celebrations and back-yard barbecues with mates.

It was their first as citizens.

Niels-Jorgen Toxvaerd, 65, on Sunday received his citizenship certificate from Prime Minister Tony Abbott and cut a birthday cake with Governor-General Quentin Bryce at Canberra's national citizenship ceremony.

He's lived in Australia for 20 years and says he's realised over the past few years he felt more Australian than Danish.

"When you are a first-generation immigrant you're always a little bit lightfooted, where to actually belong," he told AAP.

"It was a very emotional thing for me just to take the last step and become a citizen, being able to vote and being able to fully participate in Australian society.

"I've realised that's really where I belong now."

Mr Abbott's welcomed those receiving their citizenship on Sunday to team Australia.

"To the almost 18,000 taking the pledge around Australia, I say welcome to the team," he said.

"Today, across our country, we celebrate one of the greatest gifts imaginable - to be an Australian."

Queenslanders celebrated with bull riding in Redland Bay, pig racing in Paddington and cockroach racing at Brisbane's Story Bridge Hotel.

There was also an attempt to set a world record for the longest line of giant inflatable thongs on the Sunshine Coast.

In east Brisbane, punters got amongst it for $500 prize money at a pineapple-throwing competition.

The vessel met up with bark canoes under the Sydney Harbour Bridge and a traditional smoking ceremony was carried out.

Roseville resident and mother of two Belinda Pratley said she makes the trip into the city every year.

"I think it's a day that we can come together as a country and celebrate that we are a country. A unique country - our multi-cultural lifestyle - and celebrate that we're here and that it's a great place," she said.

Victorians waving Australian flags celebrated cultural diversity with a parade involving more than 60 cultural and community groups along the main streets of Melbourne.

Multiculturalism was a key theme of the day, with nearly 4500 new Victorians making their pledges to become Australian citizens.

The nation's biggest citizenship ceremony has been held in the northern Perth suburb of Wanneroo, where 751 people became Australians.

West Australian Premier Colin Barnett told the new citizens that they would be treasured.

"You'll have the protection and care of Australia, wherever you are on the planet. You'll have access to laws of Australia - safety for you, and your family and for your property," he said.